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February 15, 2013

Top Portfolio Products: OneAmerica Debuts Index(k)

Guggenheim Launches CurrencyShares Singapore Dollar Trust; more

New products introduced over the last week and actions in the industry include Index(k) from OneAmerica, MIAX Options Exchange’s new membership on the Options Industry Council, the CurrencyShares Singapore Dollar Trust from Guggenheim Investments, the Salient Global Equity Fund from Salient Partners, the Preferred Securities and Income ETF from First Trust, and the Yorkville High Income Infrastructure MLP ETF from Yorkville ETF Advisors.

In addition, Persimmon Capital Management launched the Persimmon Long/Short Fund; John Hancock Insurance launched Protection Indexed UL; new Morningstar research indicates that daily changes to exchange-traded fund premiums can be predicted in advance; Invesco PowerShares announced expansion of its low-volatility suite of ETFs; and SunGard launched Mobile Meeting for Financial Planning.

Here are the latest developments of interest to advisors:

1) OneAmerica Introduces Index(k) Product for DC Market

The companies of OneAmerica announced Tuesday the launch of Index(k), an approach to retirement plan construction focused on indexed investing. Index(k) will offer plan sponsors a menu of 18 collective trust investment options offered through Wilmington Trust Retirement and Institutional Services Co. and managed by BlackRock. These options include nine of BlackRock’sLifePath target-date investment options, as well as the stable value investment option of the American United Life Insurance Co. (AUL), a OneAmerica company.

The companies of OneAmerica will work alongside Wilmington Trust and BlackRock to position Index(k) as an investment fund strategy option for small and midsize plans.

Stocks in the MSCI All Country World Index are subjected to a hybrid investment approach of top-down metrics and bottom-up fundamental research. The fund’s portfolio consists of between 40 and 60 stocks (though it may include up to 70 stocks) that have passed this investment screening process. Typically, 70% to 85% of the portfolio is composed of stocks from issuers in developed markets, while up to 30% of the equities can be from issuers located in emerging markets.

4) First Trust Launches Preferred Securities and Income ETF

First Trust Advisors LP has launched a new actively managed ETF, the First Trust Preferred Securities and Income ETF (FPE), which seeks total return and to provide current income by investing primarily in preferred securities and income-producing debt securities, including corporate bonds, high-yield securities and convertible securities. Under normal market conditions, at least 80% of its net assets, including investment borrowings, will be allocated to these asset classes.

Asset management firm Yorkville ETF Advisors, LLC, a subsidiary of Yorkville ETF Holdings, LLC, has launched the Yorkville High Income Infrastructure MLP ETF (YMLI), which provides exposure to infrastructure master limited partnerships (MLPs), that offer capital appreciation potential as a group of companies expected to grow significantly over the next decade in response to demand for pipelines, storage and processing systems required by rapidly growing U.S. energy production.

YMLI tracks the Solactive High Income Infrastructure MLP Index, which is published and maintained by Structured Solutions AG. Exchange Traded Concepts LLC will serve as investment adviser to YMLI. Yorkville ETF Advisors LLC and Index Management Solutions LLC will serve as subadvisors.

Persimmon Capital Management LP has launched the Persimmon Long/Short Fund (LSEAX), a multiadvisor mutual fund that seeks to use long/short equity strategies to produce equity-like capital appreciation over time with less volatility than long-only strategies. The fund commenced operations with $25 million of assets under management, and is distributed by Northern Lights Distributors LLC. The minimum initial investment in the fund is $2,500 for A share investors and $100,000 for I share investors. The minimum subsequent investment is $100 for all classes of shares.

Invesco PowerShares Capital Management LLC announced expansion of its low volatility suite of ETFs with strategies covering the U.S. mid-cap and small-cap segments. The new ETFs began trading on Feb. 15. They are the PowerShares S&P MidCap Low Volatility Portfolio (XMLV) and the PowerSharesS&P SmallCap Low Volatility Portfolio (XSLV).

In addition, the PowerShares S&P Emerging Markets Low Volatility Portfolio (EELV) and PowerShares S&P International Developed Low Volatility Portfolio (IDLV) recently passed their one-year anniversary. Since inception on January 13, 2012, both EELV and IDLV have achieved better risk-adjusted returns compared to their respective MSCI benchmarks.

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